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A fall in consumer confidence in banking

November 3, 2007 by admin  
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A recent survey has shown that there has been a significant fall in consumer confidence when it comes to banking in the UK, with much of this decrease being blamed on the recent turmoil and chaos with Northern Rock.

As a result of this overall, confidence in banking and finance in the UK has taken a tumble state researchers from Teamspirit, which carried out the survey. According to the results most sectors of the banking and finance industry have been affected by this fall in consumer confidence.

One industry professional stated that the recent Northern Rock situation had had a profound effect on consumer confidence in banking and finance, stating: “The Northern Rock situation has contributed to the low levels of trust that the British public has in companies that look after their money.”

The survey involved polling around 2500 people, and showed that fewer than half of consumers trusted banks and building societies, and just a quarter now trusted online banking. The number of people that still trusted building societies was slightly higher than banks, with around 48% stating that they still had trust in building societies. Around 46% now have confidence in high street banks, and just 25% are confident when it comes to online banking.

The recent credit crunch that has spread from the sub-prime sector of the United States has also affected the level of consumer confidence in banking and finance, according to officials, with financial markets in the UK and around the world facing turmoil as a result of repercussions of the credit crisis sparked in the United States. Banks and lenders have now had to raise interest rates on many areas of lending, which has further affected both confidence and affordability in terms of finance.

Tom Smith
3rd November 2007

Tags: confidence, northern rock, accounts, finance, bank, Banking

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